Evaluation of Economic Benefit
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Basic ETAP Benefit
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Minimal economic benefit to the Town
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No tax abatement benefit
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Low economic benefit to the Town
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Year 1-2: 70% of fixed assessment abated;
or
Year 1-5: 50% of fixed assessment abated
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Average economic benefit to the Town
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Year 1-3: 70% of fixed assessment abated;
or
Year 1-5: 50% of fixed assessment abated
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High economic benefit to the Town
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Year 1-3: 100% of fixed assessment abated
Year 4-5: 70% of fixed assessment abated
Year 6: 50% of fixed assessment abated
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FORM OF AGREEMENT
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TOWN OF EAST HAMPTON
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AGREEMENT REGARDING REAL
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PROPERTY TAX ASSESSMENT
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______________________________
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EAST HAMPTON, CONNECTICUT
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This Agreement is entered into this ___ day of _____ by and
between the TOWN OF EAST HAMPTON, a municipal corporation and body
politic having its corporate limits located within the County of Middlesex
and State of Connecticut (hereinafter the "Town"), and ____________________
of East Hampton, Connecticut ("Company"), a Connecticut corporation
with a principal place of business at ______________________________,
East Hampton, Connecticut.
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WITNESSETH:
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WHEREAS, Company is responsible to pay all real property taxes
associated with the real property known as _________________ East
Hampton, Connecticut ("the Real Property"); and
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WHEREAS, Company intends to make improvements to the land and
structures on the Real Property, including the construction of approximately
_____ square feet of commercial office building and associated site
improvements located on the Real Property (the "Facility"); and
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WHEREAS, the estimated costs to be invested by Company in making
the above-described improvements to and constructing the Facility
on the Real Property will be a minimum of $__________; and
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WHEREAS, the Town, acting by and through its duly authorized
Tax Assessor, will assess and value the Real Property and personal
property on the Grand List of October 1, 2018.
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WHEREAS, the Town wishes to assist Company in its plans to add
real property and personal property value to the Town's tax base;
and
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WHEREAS, the Town wishes to assist Company to develop its __________________
plans to be submitted and approved to the Planning and Zoning Commission;
and
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WHEREAS, in consideration of the above, the Town is willing
to provide tax relief to Company pursuant to the East Hampton Business
Incentive Program Ordinance as a Tier ___ tax abatement for a period
of _____ years commencing with the first date that tax payments are
due under the Grand List following the date of issuance of the Certificate
of Occupancy for the Facility (the "Abatement Term"); and
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NOW, THEREFORE, in consideration of the foregoing, the parties
hereby covenant and agree that:
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1.
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Cost of Improvements: The costs for the improvements shall equal
or exceed $__________ in construction costs. Company will install
and properly account to the Town for all taxable personal property
assets added to or installed in the Facility.
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2.
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Certificate of Occupancy: Company will commence construction
within six months, and not prior, to this Agreement and complete construction
and obtain a Certificate of Occupancy not later than 24 months from
the date of this Agreement. Company shall actively operate or cause
said Facility to operate as __________ at the Real Property for not
less than the Abatement Term from the date of the Certificate of Occupancy.
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3.
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Employment: Company shall use its best efforts to employ or
cause to be employed at least ___ full-time and ___ part-time employees
at said Facility throughout the Abatement Term.
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4.
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Reduction of Assessment: Commencing with the issuance of a Certificate
of Occupancy, the Real Property tax assessment shall be established
on the Grand List for the period following the issuance of the Certificate
of Occupancy, and the Town shall grant to Company a ___% reduction
in its Real Property assessment such that the net effect of the reduced
assessment reduces the tax liability for the Real Property in the
amount of $________ over the _______ year period according to a schedule
attached hereto as Exhibit A, including the above-described Improvements
and the construction of the Facility (the "Abatement").
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5.
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Abatement Period: The Abatement Term shall be for a period of
_____ years commencing with the first date that tax payments are due
under the Grand List following the date of issuance of a Certificate
of Occupancy for the Facility; provided, however, that if such assessment
is changed by any future Town revaluation, the tax payments due under
the new assessed value of the Real Property shall be adjusted for
the remainder of the Abatement Term in accordance with the terms of
the Abatement set forth in Paragraph 4 above.
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6.
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Tax Payment: Company shall maintain all tax obligations owed
by it to the Town current and in good standing during the Abatement
Term.
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7.
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Certification of Value of Site Improvements: Company shall be
required to provide proof via affidavit of an appropriate officer
within one year after the commencement of operations at the Facility
as to a) the actual value of the site improvements and that said improvements
are substantially in conformance with the provisions hereof as to
the scope of construction; b) the cost of construction (a minimum
of $_____.00); and c) the number and type (full-time or part-time)
of employees employed at such Facility.
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8.
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Ongoing Employment Obligations: Notwithstanding anything herein
contained to the contrary, Company and the Town acknowledge and agree
that, while Company shall make every good-faith effort to maintain
and employ at least _____ full-time and _____ part-time employees
during the Operating Term, economic circumstances, financial considerations,
and employee transience may make it impossible to maintain precisely
the level of employment described herein. Accordingly, Company and
the Town acknowledge that variations in the numbers of employees will
occur and may continue for unspecified periods of time during the
Operating Term of this Agreement. Company will, upon request, disclose
to Town its employment statistics no more than once per year. Subject
to the above requirement of good faith and Company's cooperation in
disclosing all efforts made to comply with the employment parameters
stated herein, such variations shall not otherwise constitute a default
of this Agreement, provided the Facility is operating in accordance
with applicable law and Company is in compliance with the terms of
this Agreement in all other respects.
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9.
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Default: The following events shall constitute an event of default:
Company at any time fails pay real estate and/or personal property
taxes when due and payable; or Company fails to commence or complete
on time the construction of all improvements upon the property which
is the subject of the agreement; or Company, within 10 years of the
date of the Agreement, becomes insolvent or bankrupt or files any
debtor proceedings or others file such debtor proceedings against
the owner or lessee in any court, in any jurisdiction, state or federal,
and does not withdraw such filing within 90 days, or such other proceedings
have not been dismissed or withdrawn by such other parties within
90 days; or Company makes an assignment for the benefit of creditors;
or Company property or lease is taken under a writ of execution or
becomes the subject of foreclosure proceedings; or Company abandons
at any time the real property or in the case of the lessee purports
to assign its lease without the express consent of the Town as set
forth in this Ordinance; or Company fails to perform any obligation
of owner or lessee or attain any benchmark set under the terms of
this Agreement. In such event of default, the Town shall provide notice
to the Company of such event of default, and the Company shall have
30 days from such notice within which to cure such default. In the
event Company fails to cure the default with 30 days of such notice,
then this Agreement shall be null and void, and the Company shall
reimburse the Town for all tax relief provided to Company, retroactive
to the due date of the first abated tax payment, plus interest at
the rate set and payable pursuant to the provisions of Conn. Gen.
Stat. § 12-146, or other applicable statute, plus all prior
waived fees, if any, plus all actual costs to the Town in providing
in-kind considerations to the Company, and the Town shall be under
no obligation to grant further tax relief hereunder.
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10.
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Legal Action to Enforce the Terms: In the event that the Town
must resort to legal action to enforce the terms of this Agreement,
any amount determined by a Court of competent jurisdiction to be due
from Company shall be subject to interest at the rate of 18% per annum.
Such interest shall accrue from the postmark date for the notice of
default described in Paragraph 9. In addition, the Town shall be entitled
to recover from Company all costs of collection, including reasonable
attorneys' fees, incurred in enforcing this Agreement.
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11.
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No Further Abatement: Company acknowledges and agrees that the
Abatement offered pursuant to this Agreement is not binding upon the
Town and shall not continue, beyond the _____ year Abatement Term
agreed to herein.
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12.
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No Admission as to Values: Company and the Town acknowledge
and agree that the values placed upon the Real Property, the Facility,
and/or the Improvements as a result of the Abatement shall not now
or at any other time be construed as an admission by any party or
as evidence of any kind as to the true fair market value of the Real
Property, the Facility, and/or the Improvements.
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13.
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Notices: All notices hereunder are to be sent by the Town to
Company at the following address or to such other address as requested
by the Company or its successors or assigns: __________, East Hampton,
CT 06424 Attention: _____. All such notices shall be sent via certified
mail, return receipt requested, or overnight mail service. Notices
are deemed effective upon delivery. Any refusal to accept such delivery
shall still constitute the delivery of proper notice.
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14.
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Assignment: Company may not assign or otherwise transfer its
rights or obligations under this Agreement without the prior written
authorization of the Town Council and Economic Development Commission,
which shall signify their consents by an affirmative vote taken at
a separate meeting of each body duly noticed for the stated purpose.
A conveyance of the Real Property or a transfer of ownership of the
Company business or substantially all of the assets of the Company
to a person or business organization or entity that is not a "controlled
entity" which is owned or controlled by the Company shall not constitute
a valid assignment of the Agreement or vest any rights under the Agreement
in the grantee of the Real Property or transferee of the Company or
the assets of the Company or allow for enforcement of any obligations
of the Town against the Town by the grantee or transferee, including,
but not limited to, any remaining tax abatements under the terms of
the Agreement. A "controlled entity" means a business which is 80%
or more owned by the Company as grantor or transferor.
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15.
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Release of Liability: Company and/or its successors or assigns
releases the Town and its agents, servants and employees from any
and all liability, of whatever nature, legal or equitable, which may
have arisen or which may arise in connection with this Agreement,
including the implementation hereof.
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16.
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Indemnification: Company and/or its successors or assigns shall
defend and indemnify the Town and any of its agents, servants and
employees against any action, claim or suit of any nature whatsoever,
arising from the Town's being a party to this Agreement and/or any
undertaking of its obligations hereunder.
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17.
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Execution: This Agreement has been executed by the parties'
respective agents, duly authorized and acting in his or her official
capacity.
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18.
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Amendment: This Agreement may be amended only by mutual consent
of the parties, and any amendments to this Agreement shall be in writing
and shall be duly executed and dated by the respective parties.
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19.
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Complete Agreement: This Agreement represents the entire and
complete understanding and agreement of the parties, and any and all
prior written or oral agreements not otherwise contained in this Agreement
shall be and are hereby null and void and of no force or effect.
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20.
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Choice of Law and Venue: In the event that litigation or other
dispute resolution process arises, all litigation and dispute resolution
shall take place in the State of Connecticut, Judicial District of
Middlesex, and the Agreement shall be construed in accordance with
Connecticut law, without regard to its conflict of law provisions.
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21.
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Notice of Tax Abatement: Upon the execution of this Agreement,
a copy of this Agreement or a proper "Notice of Tax Abatement Agreement"
shall be filed upon the land records of the Town with respect to the
Real Property.
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22.
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Special Conditions: In addition to all other terms and conditions
of this Agreement, the Town's obligations under this Agreement are
conditioned on the following ("the Conditions"):
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(a)
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Project Financing: Company demonstrates to the reasonable satisfaction
of the East Hampton Finance Director that it has private financing
and state and federal grants in place in an amount sufficient to undertake
and complete the project;
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(b)
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Property Maintenance: Company demonstrates that it has maintenance
contracts in place to keep the property maintained during the period
of construction;
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(c)
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Non-Transferable: As set forth in Paragraph 14 herein, Company
acknowledges and affirms that this tax abatement is non-transferable
and any transfer of the tax abatement to a non-related entity shall
be an event of default; and
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(d)
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_____ [other specific terms]
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In the event that the Company fails to satisfy the Conditions
set forth in this Special Conditions paragraph, this Agreement shall
be null and void and the Real Property as improved shall be assessed
in accordance with the Connecticut General Statutes without regard
to the terms and conditions of this Agreement.
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SIGNATURES FOLLOW
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IN WITNESS WHEREOF, the parties hereto have hereunto set their
hands and seals as of the day and year first written above.
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Witnessed By:
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COMPANY:
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_____________________________________
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By: _____________________________
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Its CEO, Duly Authorized
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_____________________________________
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Witnessed By:
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TOWN OF EAST HAMPTON:
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_____________________________________
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By: _____________________________
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Its Town Manager, Duly Authorized
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_____________________________________
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